How To Fix Rejected Bank Transfers in QuickBooks Online

How To Fix Rejected Bank Transfers in QuickBooks Online

Rejected bank transfers (ACH/bank payments) in QuickBooks Online are fixed by: identifying the failed payment, reversing it correctly in QuickBooks, and then recharging or recording a new payment so your books and bank match.​

Step 1: Confirm what failed

  • Check if this is a customer bank payment via QuickBooks Payments (ACH on an invoice), not just a bank feed error.​

  • Go to Sales → All sales / Customers → Invoices, open the invoice, and look at the payment status (e.g., “Rejected,” “Failed,” “Returned NSF”).​

  • Note the reason code (insufficient funds, invalid account, unauthorized, etc.) so you know whether to reattempt or ask for a different payment method.​

Step 2: Understand if money ever hit your bank

  • If the payment was never deposited (QuickBooks shows it failed and your bank never received it), you usually just need to remove/void the payment in QuickBooks so the invoice goes back to open.​

  • If the payment was deposited and then reversed (a return/chargeback/NSF), you must record both:

    • The reversal leaving your bank.

    • The re-open of the customer’s invoice (and any fees).​

Step 3: Remove or reverse the original payment in QBO

For payments processed through QuickBooks Payments (bank transfer/ACH):​

  • Open the original invoice.

  • Click the payment link at the top (the linked bank payment).

  • In the payment window:

    • If QuickBooks created a separate “Rejected bank transfer” entry, follow the “Fix a rejected bank transfer payment” workflow to link that to the correct invoice.​

    • If the payment itself must be removed, choose More → Delete (or Void if available) to detach it so the invoice returns to Open.​

    • This prevents the rejected payment from continuing to show as applied or causing “Attention needed” in Payments.​

    Step 4: Record the bank reversal and any fees

    When the bank pulls the money back or charges a returned item fee:​

    • In + New → Expense (or Bank Deposit/Journal, depending on your workflow):

      • Payee: your bank or QuickBooks Payments.

      • Payment account: the bank account where the deposit came in.

      • Category:

        • For the reversal of the customer payment, use the same income/clearing account that the deposit originally used (often “Undeposited Funds” or your income account, per your accountant’s setup).​

        • For fees, use a Bank service charges / Merchant fees expense account.​

    This makes your bank balance in QuickBooks match the actual deposit minus any reversal and fees.​

    Step 5: Re-open or re-invoice the customer and take new payment

    • Verify that the original invoice now shows as Open after removing the failed payment.​

    • Ask the customer for:

      • Updated bank details (if routing/account were wrong or account closed).​

      • A different payment method (card, check) if there were insufficient funds or authorization issues.​

    • Record the new payment:

    • If paying online, let them pay the existing open invoice through QuickBooks Payments again.

    • If paying offline (check, cash), use + New → Receive payment, select the customer and invoice, choose the payment method, and save.​

    Step 6: If “Attention needed” or errors persist

    • Make sure every step in the “Fix rejected bank transfers in QuickBooks Online” workflow is followed: identify the rejected payment, create any needed tracking item/invoice, move the payment correctly, and attach it to an expense if required.​

    • If the invoice still shows paid or an “Attention needed” banner remains after you redo the steps, Intuit recommends contacting QuickBooks Payments support, as they can see the processor-level status and clear stuck transactions.​

    If you describe your exact scenario (invoice paid by ACH vs deposit reversed, and what status you see), a more tailored, line-by-line set of clicks for your version of QuickBooks Online can be provided.